Motorpoint reinstates dividend after swing to profit

(Sharecast News) - Vehicle retailer Motorpoint has reinstated its dividend after swinging to a profit in the year ended 31 March on the back of solid revenue growth, increased use of data-led analytics and improved stock management. The company, which last paid a dividend in early 2020, said it would be paying shareholders 1p per share for the year to complement its share buyback plan announced in April, and pledged a "progressive dividend policy" going forward.

Revenues for the year rose to £1.17bn from £1.09bn previously, as the number of vehicles sold increased 12.4% to 87,700, while the number of days in stock fell to 43 from 45.

Top-line growth, in addition to "significant variable cost savings", helped the company record a pre-tax profit of £4.1m, compared with a loss of £10.4m previously.

Chief executive Mark Carpenter said he was "extremely pleased" with the group's performance after several years of "considerable economic headwinds that have hampered our industry".

For the current year, Motorpoint said it has seen growth in retail volumes over April and May despite tougher comparatives with last year, while profitability has increased year-on-year.

"We expect ongoing macroeconomic pressures to generally ease, with further, moderate reductions in interest rates and supply of nearly new used vehicles should continue to slowly increase. However, we remain mindful consumer confidence in the near term remains uncertain. We will continue to prudently manage the cost base despite labour inflation headwinds," Carpenter said.

Motorpoint shares were up 1.2% at 0822 BST.